Chief minister Prithviraj Chavan is under tremendous pressure not only from other political parties, but even fellow Congressmen to give into the protesting traders' demand to scrap the local body tax (LBT).
Cornered, the CM has appointed a high-level committee under chief secretary JK Banthia to discuss the issues raised by the traders and recommend amendments to the proposed tax reform. He has, however, made it clear that the LBT will not be rolled back.
The committee has been asked to consider suggestions and objections of traders’ associations and incorporate them in the new rules, which the state legislature is expected to approve in the monsoon session. The committee has been given a month to submit its report to the government. It will specifically focus on LBT in Mumbai because of the massive size of daily business.
The members of the panel include principal secretaries of the finance, urban development, law and judiciary departments, and municipal commissioners of Mumbai, Pune, Thane, Navi Mumbai and Kalyan-Dombivli.
Chavan is adamant that the tax will not be scrapped. “We are ready to sit and discuss the issue with traders and consider their demand to make the process more efficient. But, LBT withdrawal is not possible in any way,” Chavan said.
He took a lenient approach against the protesting traders saying the government was not contemplating any action against them. “We don’t want to take hard action against anyone even though they are holding the state to ransom. It’s a process of economic reforms and we have to accept it,” he said.
Chavan also sent letter to MPs, legislators and mayors of civic bodies in Maharashtra explaining why the LBT was necessary in public interest. His appeal will be given wide publicity in media through an advertisement campaign.
In forming a panel under the chief secretary, Chavan ensured that ally NCP's suggestion for a appointing a group of ministers to discuss the issue was ignored completely.